Reforming the U.S. Tax Code

Federal tax reform has been a topic of discussion for some time now. As the national deficit has continued to increase over the past few years, so has the priority for this analysis. Although a number of proposals have been submitted, the problem is coming to an agreement on how exactly the code should be reformed, if reformed at all versus starting with a brand new code altogether. The problem is that there is no cookie cutter tax system that will be fair to all. With that being said, is a flat tax the way to go? There is no tax system that would be beneficial to all Americans. Just like any tax reform, a flat tax system has its own set of pros and cons. For example, a flat tax system would eliminate the current extensive tax code that is extremely difficult to interpret. It would result in an easier understanding of the tax code as well as reduce the chance for errors and tax fraud (Sonic, 2013, para. 7). Additionally, it would cause a reduction in the need for paid tax preparers, which is actually a pro and con. It would save taxpayers money by eliminating the need for paid tax preparers but at the same time would also cause a reduction in the workforce for that industry (Sonic, 2013, para. 7). As a result, this would cause a rise in the number of displaced workers’ as well as putting numerous tax software companies out of business. Moving on, a flat tax would eliminate the ability to create tax loopholes by the government, as previously done, for personal favors or campaign contributions (Sonic, 2013, para. 7). Furthermore, it could help businesses redirect their efforts from ways to reduce their tax liability to increasing their presence in the marketplace (Sonic, 2013, para. 7). Lastly, the flat tax has the potential to encourage investments because investment income would not be taxed (Sonic, 2013, para. 7). The list of cons of a flat tax system is…...

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...30-40% of our hard earned money really rubs me the wrong way. There is a very common sense solution to this serious problem that is being very seriously discussed and considered in our Congress. It is a plan called the Fair Tax.
Legislative Status:
The FairTax has been reintroduced for the 111th Congress. It is H.R. 25 in the House and S. 296 in the Senate.
Benefits of the FairTax:
The FairTax plan brings fairness, transparency, and efficiency to our unfair, complex, and confusing Tax Code.
The FairTax rewards job creation, hard work, and individual responsibility. By doing away with payroll taxes, companies can afford to hire more employees and outsourcing looks less attractive. By taxing consumption instead of income, individuals are provided with a strong incentive to work hard because they keep more of what they earn. By taxing spending, the FairTax allows us to control how much tax we pay depending on our individual lifestyle choices.
The FairTax ensures that all Americans pay their fair share of taxes. By placing the tax at the point of sale, no individual or special interest group could evade taxes with the help of an expensive tax attorney or well-funded lobbyist. We could stop making criminals out of ordinary Americans who prepare their tax returns incorrectly by mistake.
How the Plan Works:
The FairTax proposal is a comprehensive revenue plan that would eliminate most major federal income and payroll taxes, including personal, gift, estate, capital......

...where more favorable tax rates lie. Will lowering this corporate tax rate help bring back those jobs to the U.S. and decrease the growing unemployment rate? Some argue yes, while other experts say no. While we argue both sides of this topic, the goal of this paper is to leave you, the reader, with enough facts to form your own opinions to the above question.
How The Income Tax Came To Be
In order to learn how the current corporate tax rates came to exist, we must first look at the history of the income tax. Although the Revenue Act of 1894 established the principle of taxing corporations separate from their owners, a federal tax on corporate income was never imposed until 1909. The Revenue Act levied a 2% income tax on any incomes totaling more than $4000 in order to make up the lost federal revenue (Dierdrich 2011). In the next year, the U.S. Supreme Court deemed the Act unconstitutional saying it was not allocated according to the population size of each state. How did Congress work around this? With the same principles in mind that lie within the Revenue Act of 1894, Congress passed the Corporation Excise Tax Act in 1909 (2013). Apart from its predecessor, this Act imposed a 1% tax on corporate income totaling more than $5000 (Tax Foundation 2013); however, it wasn’t until 1913 and the creation of the 16th amendment, which allows Congress to levy an income tax not apportioned to the population of each state, that removed all questions of the income tax being......

...Common Sense Approach to Reforming the Federal Tax System
On February 3, 2013 marked the 100th birthday of the 16th Amendment. The 16th Amendment paved the way for the creation of the federal income tax that continues to this day to have far reaching repercussions on the American tax payer. Before the ratification of the 16th Amendment, the birth of the federal income tax dates back to the Civil War. In order to finance the Civil War, President Abraham Lincoln signed into law Revenue Act of 1861 on August 5, 1861. The Revenue Act consisted of a flat tax rate of 3% on income above $800 and 5% on individuals living outside of the United States. On July 1, 1861 United States Congress repealed the Revenue Act of 1861 and replaced it with the Revenue Act of 1862. The Revenue Act of 1862 introduced a progressive tax and established the Bureau of Internal Revenue. In 1872 Congress repealed the Revenue Act of 1862. One again elected officials tried to revive the federal income tax in 1894. However, in 1895 the federal income tax was declared unconstitutional by the U.S. Supreme Court because the tax was not apportioned according to the population of each state. In an address to Congress on June 16, 1909 President Howard Taft proposed that Congress consider a new amendment to the Constitution. “I recommend, then, first, the adoption of a joint resolution by two-thirds of both Houses, proposing to the States an amendment to the Constitution granting to the Federal......

...Louisiana Tax Reform:
Eliminating Corporate and Franchise Taxes
The relationship between tax policies and economic growth is a topic that has been frequently debated. For decades, economists have developed studies exploring this relationship and analyzing its effects. These studies concluded that a negative relationship exists between taxes and economic growth. Taxes have a negative impact on economic growth because of how they influence the activities individuals and firms choose to engage in. Businesses and individuals often base their decisions on the overall tax burden, which creates a disincentive to engage in activities taxed at a higher rate. The Tax Foundation evaluates each state’s business tax climate every year in order to indicate which states’ tax systems are the most attractive to business and economic growth. According to the Tax Foundation’s 2013 State Business Tax Climate Index, Louisiana’s tax system is currently ranked 32nd, far below the rankings of progressive southern states such as Florida and Texas. In addition, Louisiana’s tax structure is poorly perceived because of its complexity. Therefore, in order to create a competitive advantage, the Louisiana tax system must be reformed. Several of the states that rank highest in the 2013 State Business Tax Climate Index do not levy a tax on corporations. Furthermore, the average annual growth rates for those states without a corporate income tax exceeded the growth rate of all other states...

...Reforming California’s Sentencing Law
Hearing the words “three strikes, you’re out” probably invoke thoughts of umpires, baseballs, and pitchers in the minds of most. In California, if you are familiar with the legal system, “three strikes, you’re out” will likely give you a vision of thousands of inmates dressed in orange, sleeping on bunk beds inside overcrowded gyms. In November 1994, California legislators and voters made a major change to the California sentencing laws with Proposition 184. This proposition better known as the “3 Strikes Law” has long been a controversial topic in California. It has spurred debates as to whether it is considered cruel and unusual punishment for the thousands of repeat offenders sentenced every year. Proposition 184 is a cruel punishment for the thousands of inmates packed into state prisons, and the taxpayers spending billions to keep them there. Over the years legislators have sought a way to reform the 3 strikes law. In November of 2012, Proposition 36 was enacted as an initiative designed to preserve the original idea. The idea was to impose life sentences on serious and violent offenders without imposing excessive sentences on non-violent offenders. As California searches for ways to decrease the recidivism rate of serious and violent offenders, we have to consider the current laws and the impact these laws have on the state of California.
Currently 4,000 men and women who are serving terms of 25 to life in......

...Reforming the U.S. Tax Code
Martin McDowell
Professor Ken Lavery
11/24/13
Reforming the U.S. Tax Code
A flat tax rate would be beneficial to all Americans. Critics of such proposals generally say that the wealthiest people in the nation would be the ones to benefit the most. The overall flat rate of tax would mean cuts for all Americans. The sheer simplicity of a flat rate is one of its biggest selling points. Rick Perry's plan offered in 2011 was imperfect, but it represented a overall structure and ideas. The focus of the plan scrapped, “the graduated income tax and replace it with a 20 percent flat rate. By throwing out rates as high as 35 percent and eliminating estate and investment taxes, the plan would grant a major tax cut for the wealthy…his proposal would also offer benefits to middle-class Americans by giving a $12,500 deduction for every member of a household while preserving exemptions for state and local taxes, mortgage interest and charitable contributions for anyone making less than $500,000. He said anyone could still file under the current code, and he also pledged to lower the corporate tax rate to 20 percent, from 35 percent” (Oppel, 2011). This means that taxes will be sliced for all groups in America: this will equate to more money for individual Americans, allowing them to make a greater investment in the private economy.
The plan was criticized as being ambitious because of the fact......

...Tax Reform Racket
First and foremost let us begin by clarifying that we are by no means economists. However, we are United States taxpayers, and we know us as well as our neighbors are being robbed. For a better understanding of this let us look at a few areas that led to this. These areas include Article I section 8 of the U.S. Constitution, the U.S. Civil War, and the 16th Amendment. Article I section 8 of the U.S. Constitution authorizes the power, The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States. ("Constitution of the United States - Official") This is all well and good, however things start to get a little heated in America come 1861. Unfortunately we split and Civil War began and come 1862 America needed a way to finance a war against itself. Thus came the federal income tax, also know as the Revenue Act. Though the Civil war contributed to one of the greatest social victories of mankind it has led to the beginning to America’s loss of liberty. (Edwards) In April 1865 Uncle Sam Removed the chains of slavery in the U.S. on African Americans then in 1913 applied them to all Americans the 16th Amendment. Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without......

...Thomas Collura
From: Bryan Alread
Date: October 6, 2014
Re: Corporate Tax Refund Claim
Facts: The client used an extension on their 2010 calendar year tax return to extend their filing date to September 15, 2011. The client electronically filed their return on September 4th but was rejected by the IRS. After making some changes they resubmitted their return on September 9th and was received and accepted by the IRS on September 10th. On June 10th 2014, just under three years later, the corporation realized that they reported to much income for their calendar year 2010 tax return.
Issue: What is the latest date the corporation can file a claim for a refund on calendar year 2010 tax return?
Conclusion: The latest date in which the corporation can file a claim is September 9th, 2014.
Analysis: Under section 6511 of the U.S Code, a claim for credit or refund of an overpayment can file a return within three years from the date the original return was filed or 2 years from when the tax was paid, whichever expires later. Under these facts we do not know when the tax for the return was paid and will go with the date the original return was filed. The corporation filed their return on September 4th but was rejected and then resubmitted their return on September 9th, which were accepted by the IRS on September 10th.
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...Reforming the U.S. Tax Code
Accounting 307: Federal Taxation
Professor Margaret Parrish
Kinisha Doley-Griffin
November 24, 2013
Should the tax system be reformed or should it not be reformed. That has been the question for years asked by congress and the people. Congress has not acted upon changing the tax system once during the debates. Many proponents of the tax reform support one system over another. We have heard multiple new suggestions for tax codes such as value added tax, a national sales tax, fair tax and the flat tax.
The flat tax has been in talk since the 1980’s, it was first suggested by two colleagues at the Hoover Institution, Robert Hall and Alvin Rabushka. Hall-Rabushka proposed that the present system would be replaced with a consumption tax. (Lang, 2012) This means that income would be taxed at the amount withdrawn or initially earned. This is the only time that the money made will be taxed and you would pay no other taxes. The flat rate tax will be set initially at 19 percent and would offer a family exemption. The goal is to have the flat tax rate set as low as possible and to keep the taxation base as broad as possible. Their plan is to maintain revenue neutrality for the government and allow taxpayers to keep more money they earn in their pockets.
In my opinion I think that the flat tax rate is as far as one can get. Yes, no one wants to pay taxes at all but living in America this is something that you must do or you will be fined. With the......

...Tax Law and Accounting
Craig
ACC 483
June 21, 2010
Jeff Hough
Modern taxation comes from a long history of changes in the United States beginning with the Revenue Act of 1861 that was designed to assist with funding the Civil War. This tax was repealed 10 years later. “In 1894 Congress enacted a flat rate federal income tax, which was ruled unconstitutional the following year by the U.S. Supreme Court because it was a direct tax not apportioned according to the population of each state” (Terrell, 2009, History of Tax Law, para. 2). In 1913, the Sixteenth Amendment enacted modern day federal income tax in the United States. Before 1913, the federal government relied on customs duties and excise taxes as its source of income. As America developed the U.S. government needed additional income to sustain its operations. The Sixteenth Amendment consisted of just one sentence: “The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration” (Pope, Anderson, & Kramer, 2010, p. 1-3). The implementation of income tax remains one of the most remarkable institutions created in this era.
Modern Income Tax Statutes
The primary objective of modern tax statutes is to generate revenue to sustain governmental operations. The largest source of federal revenues is individual income taxes. Other sources come from corporate income taxes and......

...Code of Ethics Paper
Lindsey Green, Dawn Galvan, Angela Carbo, Hughie Webb
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Mr. Lawrence Fergus
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Health care ethics involve moral principles, beliefs and values that help health care providers make good decisions about medical care. The core element of health care ethics is the sense of right and wrong, the rights that we possess and the duties we owe to others. “Thinking carefully about the ethical aspects of health care decisions helps us make choices that are right, good, fair and just for all patients” ("Health Care Ethics: Overview Of The Basics", July 2015.).
The organization we are choosing is the CDC (Center for Disease Control and Prevention). This organization is a federal agency which supports health promotion, prevention and preparedness activities in the United States with the goal of improving public health. (“Centers for Disease Control and Prevention,” 2014). The CDC was established in 1946 to combat a serious malaria outbreak and is controlled by the Department of Health and Human Services. The CDC works with partners at all levels in an attempt to monitor and prevent disease outbreaks and to oversee the implementation of disease prevention strategies. The CDC focuses on five areas which include the following: increasing support to health departments, improving global health, decreasing leading causes of death, strengthening surveillance and epidemiology, and reforming health policies. The CDC educates the...

...ACC 307 Week 7 Assignment 1 Should the U.S. Convert to a Zero Personal Income Tax
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ACC 307 Week 7 Assignment 1 Should the U.S. Convert to a Zero Personal Income Tax
1. Analyze the way in which the two (2) countries that you have researched provide services and benefits to its citizens without collecting personal income taxes.
2. For the countries that you have chosen, determine whether or not the U.S. could adopt their taxation model without reducing its total amount of revenue generated by collecting personal income taxes from individuals and business. Justify your response.
3. Create a proposal for where the revenue would be derived if the U.S. were to adopt a zero income tax model. In your response, provide specific recommendations concerning the following:
4. Suggest at least three (3) advantages and three (3) disadvantages of the U.S. adopting a zero income tax model. Provide a rationale for your response.
5. Speculate on the primary way in which the federal government could make up any shortfalls if it does not collect its targeted revenue from personal income taxes, and ascertain the most significant way in which the U.S. Department of the Treasury, through the IRS, can still adhere...

...ACC 307 Week 7 Assignment 1 Should the U.S. Convert to a Zero Personal Income Tax
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1. Analyze the way in which the two (2) countries that you have researched provide services and benefits to its citizens without collecting personal income taxes.
2. For the countries that you have chosen, determine whether or not the U.S. could adopt their taxation model without reducing its total amount of revenue generated by collecting personal income taxes from individuals and business. Justify your response.
3. Create a proposal for where the revenue would be derived if the U.S. were to adopt a zero income tax model. In your response, provide specific recommendations concerning the following:
4. Suggest at least three (3) advantages and three (3) disadvantages of the U.S. adopting a zero income tax model. Provide a rationale for your response.
5. Speculate on the primary way in which the federal government could make up any shortfalls if it does not collect its targeted revenue from personal income taxes, and ascertain the most significant way in which the U.S. Department of the Treasury, through the IRS, can still adhere to its fiscal and monetary policies. Justify your response....